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60A.111 Qualified assets to required liabilities; ratio.

Subdivision 1. Report. Annually, or more frequently if determined by the commissioner to be necessary for the protection of policyholders, each foreign and domestic insurance company other than a life insurance company shall report to the commissioner the ratio of its qualified assets to its required liabilities.

Subd. 2. Plan. If the commissioner determines that the required liabilities of any company are greater than its qualified assets and that the combined financial resources of the insurance company members of any insurance holding company system of which the company is a member are not adequate to counterbalance that fact, the commissioner may require the company to submit to the commissioner for approval a plan by which the company undertakes to bring the ratio of its qualified assets to its required liabilities, expressed as a percentage, up to at least 110 percent within a reasonable period, usually not exceeding five years.

Subd. 3. Power of commissioner. If, following a hearing on notice to the company, the commissioner determines that a company's plan is inadequate or the insurer is not making satisfactory progress toward increasing the ratio of its qualified assets to its required liabilities and that no satisfactory alternatives are available, the commissioner may institute rehabilitation proceedings against a domestic company under chapter 60B. Where the company is not a domestic insurance company, the commissioner may impose restrictions on the company as a condition to the company obtaining a new or renewal certificate of authority to transact business in this state, and may where circumstances so justify revoke or rescind any certificate previously issued.

Subd. 4. Repealed, 1983 c 340 s 18

Subd. 4a. Prohibition. If the commissioner determines that the company does not have unrestricted surplus, the commissioner may prohibit that company from purchasing any asset which is not a qualified asset as defined in section 60A.11, unless a request is made of the commissioner and the request is not denied within 15 days. The commissioner may exempt any insurer from the requirements of this subdivision.

Subd. 5. Denial of certificate. No insurer other than a life insurer which does not have unrestricted surplus as of December 31 of the immediately preceding year shall be issued a certificate of authority.

Subd. 6. Factors considered. The commissioner, in exercising discretion under this section, may take into consideration the size, the lines of business, and the dispersion of risks of the company, and the consolidated assets and surplus as regards policyholders of the other insurers of the insurance holding company system of which the company is a member and any other factors deemed relevant by the commissioner.

HIST: 1981 c 211 s 27; 1983 c 340 s 9-11; 1986 c 444; 1994 c 425 s 3; 1995 c 258 s 3; 1999 c 177 s 11

Official Publication of the State of Minnesota
Revisor of Statutes